Generative AI

2024

Apple

<p>After experiencing a downturn for two consecutive years, the global smartphone market shows early signs of recovery in 2024. This resurgence is attributed to various factors, including the growth of emerging market economies, a rebound in consumer spending, an increase in average selling prices, and the rapid integration of generative artificial intelligence in devices.</p>
<h2 class="wp-block-heading" id="market-forecast-in-a-gradual-uplift">Market forecast in a gradual uplift</h2>
<p>Research firm Canalys predicts a modest year-on-year growth of 4% 2024 for global smartphone shipments, following a 12% decline in 2022 and a 5% drop in 2023. This positive trend signals a stabilization in the industry, particularly in emerging regions like the Middle East, Africa, and Latin America, which are expected to grow 9%, 3%, and 2%, respectively, in 2023.</p>
<p>Counterpoint Research supports these findings, projecting a 3% increase in global smartphone shipments in 2024. This growth is driven by emerging markets’ recovery, improved consumer confidence, and favorable macroeconomic conditions.</p>
<h2 class="wp-block-heading" id="factors-influencing-the-market">Factors influencing the market</h2>
<p>Several elements are contributing to the smartphone market’s revival. Analyst Anshul Gupta from Gartner notes that high prices, particularly for food and energy, have impacted consumer spending, leading to a slowdown in smartphone sales. However, as these effects become less pronounced, the market is beginning to recover.</p>
<p>Ramazan Yavuz from International Data Corporation highlights the increased lifespan of smartphones as a factor impacting consumer demand. This trend has put pressure on the market, grappling with low profitability and negative economic outlooks.</p>
<h2 class="wp-block-heading" id="industry-dynamics-and-consumer-preferences">Industry dynamics and consumer preferences</h2>
<p>Regarding market leadership, Samsung Electronics continues to dominate the global smartphone market with a 20% share, followed by Apple with 16%, and Chinese brands Oppo and Xiaomi hold 14% each. Introducing foldable devices and premium models is expected to impact average selling prices positively.</p>
<p>There’s a notable shift towards high-quality, durable phones on the consumer front. Research by GfK shows a decline in demand for mid and low-end phones (less than $600) in 2023, while the demand for premium models (over $600) rose significantly. This trend reflects consumers’ preference for devices that align with their fast-paced lifestyles and offer a simplified user experience.</p>
<h2 class="wp-block-heading" id="generative-ai-in-a-game-changer">Generative AI in a game changer?</h2>
<p>Generative AI smartphones are expected to double their market share in 2024, with Samsung poised to capture half of this segment. These AI-powered phones will likely be first launched in high-end and premium devices, initially addressing a narrower portion of the consumer base. By 2027, the industry’s share of generative AI smartphones is projected to reach 40%, surpassing 522 million units in shipments.</p>
<h2 class="wp-block-heading" id="regional-outlook">Regional outlook</h2>
<p>In the Middle East and Africa, growth is expected to be modest. In the UAE, for instance, smartphone shipments are predicted to rise by 9%. The Android market is showing a positive outlook, focusing on market penetration with more affordable brands. Conversely, Apple is anticipated to see a slight drop in 2024, stemming from a healthy performance in 2023.</p>
<p>Overall, the smartphone industry is poised for a significant recovery by late 2023, continuing into 2024. This recovery is not only a reflection of a macroeconomic shift but also a result of strategic adjustments by manufacturers and a shift in consumer preferences towards more advanced and durable devices. As the industry navigates through the changing landscape, striking the right balance between innovation, competitive positioning, and market-specific challenges will be crucial for sustained growth.</p>

2024 Smartphone Market: Signs of Recovery and Emerging Trends

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